Digital currency is virtual money that can be used to buy and sell goods or services on the Internet. Bitcoins are an example of digital currency. Bitcoins are not controlled by central banks or any country, and can be traded anonymously. Bitcoins can be bought and sold in return for traditional currency, and can also be transferred from one person to another.

Do tax rules apply when digital currency is used?

Yes. Where digital currency is used to pay for goods or services, the rules for barter transactions apply. A barter transaction occurs when any two persons agree to exchange goods or services and carry out that exchange without using legal currency. For example, paying for movies with digital currency is a barter transaction. The value of the movies purchased using digital currency must be included in the seller’s income for tax purposes. The amount to be included would be the value of the movies in Canadian dollars.

More information on the tax implications of barter transactions is available by consulting the Canada Revenue Agency’s Interpretation Bulletin IT-490, Barter Transactions.

Digital currency can also be bought or sold like a commodity. Any resulting gains or losses could be taxable income or capital for the taxpayer. Paragraphs 9 to 32 of Interpretation Bulletin IT-479R, Transactions in Securities, provide information that can help in determining whether transactions are income or capital in nature.

Should I be concerned about reporting requirements when using digital currency?

Not reporting income from domestic or foreign sources is illegal. Canadians should know that the Canada Revenue Agency (CRA) is very active in pursuing cases of non-compliance, in order to ensure that the tax system remains fair for everyone.

If required, you should take this opportunity to correct your tax affairs through the CRA’s Voluntary Disclosures Program. For more information, go to www.cra.gc.ca/voluntarydisclosures.

It would be cool if we banded together and filled in relevant bits in an concentrated format.

Thanks for doing that. This thread has bitcoin-related developments such as the Alydian bankruptcy filing, which is a court case but has little to do with regulatory issues. And thus is probably not a good candidate for that wiki article. But it would be good for these to continue being recorded. So perhaps we would want to keep this thread going, but also post relevant legal and regulatory developments to that wiki article as well?

Abstract: A Political Action Committee solicits the FEC's opinion on varios aspects of Bitcoin being accepted for political campain contributions.

Update:

The FEC's response:

Quote

The Commission concludes that CAF may accept Bitcoins as in-kind contributions under valuation, reporting, and disbursement procedures, as described below. CAF may not, however, make disbursements using Bitcoins. Instead CAF must sell its Bitcoins and deposit the proceeds in its campaign depositories before using the funds.[...]Thus, because Bitcoins are neither the currency of any country nor negotiable instruments, Bitcoins are not “money” under Commission regulations. Therefore, a political committee that receives Bitcoin contributions may not treat them as monetary contributions.[...]Like securities that a political committee may receive into and hold in a brokerage account, Bitcoins may be received into and held in a Bitcoin wallet until the committee liquidates them.[...]If the committee sells the Bitcoins directly to a purchaser, and therefore knows the identity of that purchaser, the purchase is itself considered to be a contribution.

The AG’s office says that company co-founder Eric Thunberg and software engineer Sean Hunczak were both involved in the scam. In a statement posted to its website, ESEA said the software was the work of a single engineer, presumably Hunczak

There seems to be a lot of movement in the Legal Realm Was wondering if this site seems like a fair representation for keeping track of some legal changes we might miss Stephen gave it a browse looks fair enough in its perspective for me. http://bitlegal.net/

Russian Central Bank Issues a Strong Counterpoint to Sberbank Chief2014-01-27From http://bitlegal.net/Abstract: Two strong positions on Bitcoin and virtual currency are emerging in Russia. On Jan. 27., the Central Bank of Russia warned that businesses involved with Bitcoin would potentially be considered involved in money laundering or terrorism financing. This is in sharp contrast to the Jan. 24 comments by the Sberbank CEO, who called restrictions on virtual currencies a "colossal step backward."

The Bank of Russia said that recently in the world have a certain distribution of the so-called "virtual currency", in particular, Bitcoin. By "virtual currencies" and there is no provision for them legally obliged entities. These operations are speculative in nature, carried out on the so-called "virtual exchanges" and carry a high risk of loss of value.

The Bank of Russia warns citizens and legal entities, primarily credit institutions and non-credit financial institutions, the use of "virtual currency" for them in exchange for goods (works, services) or cash in rubles and foreign currency.

According to article 27 of the Federal Law "On the Central Bank of the Russian Federation (Bank of Russia)" issue in the Russian Federation monetary surrogates prohibited.

Due to the anonymous nature of the activity for the production of "virtual currency" unlimited range of actors and to use them for transactions citizens and legal persons may be, including unintentionally involved in illegal activities, including the legalization (laundering) of proceeds from crime and terrorist financing.

The Bank of Russia has warned that Russian legal entities providing services for the exchange of "virtual currency" in rubles and foreign currency, as well as for goods (works, services) will be considered as a potential involvement in the implementation of suspicious transactions in accordance with the legislation on counteraction to legalization (laundering) proceeds of crime and financing of terrorism.

This thread is no longer being updated all that much. As Bitcoin further permeates the world, most every nation (or state, etc.) will have content specific to that jurisdiction's involvement with Bitcoin. Feel free to continue posting as you wish, but this thread will no longer be even close to being a comprehensive list as it had been for a period of time.

Executive summary: crypto currencies should not be confused with electronic means for payments in BRL. They have no emitting entity, backing institution or assets, no guarantees of acceptance or conversion to national currencies. Their price may fluctuate wildly, even to zero, and governments may prevent their use. They may get you involved in criminal investigations even if you use them in good faith. They may be stolen by hackers. We do not see them yet as a risk to the National Financial System, but we are following discussions in international forums and we may act if and when it is necessary.

[Approximate translation by Jorge Stolfi, provided for reader's convenience only. The translation is not guaranteed to be accurate, especially with respect to the precise legal meaning of terms. This text should not be relied upon for legal purposes.]

The Central Bank of Brazil informs, first of all, that the so-called virtual currencies should not be confused with the "electronic currency" that are the subject of Law 12.865, of October 8, 2013, and their infra-legal regulations. Electronic currencies, as disciplined by those norms, are assets stored in an electronic device or system that enable the end user to execute a payment trasaction valued in national currency [the Real, BRL --JS]. On the other hand, the so-called virtual currencies have their own form of denomination, that is, are expressed in accouting units that are distinct from the currencies emitted by sovereign governments, and cannot be considered electronic devices or systems for the storage of Reals.

​The use of so-called virtual currencies and the application, to them, of regulations that apply to the financial system and to payment systems, have been topics of international debate and statements by monetary authorities and other public authorities, with few conclusions to this moment.

The so-called virtual currencies are neither emittled nor guaranteed by any monetary authority. Some are emitted and intermediated by non-financial entities, while others do not even have an entity that is responsible for their emission. In both cases, the entities and persons who emit or act as intermediaries of those virtual assets are neither regulated nor supervised by monetary authorities of any country.

Those so-called virtual currencies have no guarantee of conversion to the official currency, and furthermore are not guaranteed by real assets of any kind. The conversion value of an asset known as virtual currency to currencies emitted by monetary authorities depends on the credibility and trust that the market agents may have in the acceptance of the so-called virtual currency as exchange instrument, and of the expectations of its appreciation. There is, therefore, no governmental mechanism that would guarantee the official currency value of the instruments known as virtual currencies, leaving the risk of their acceptance wholly in the hands of users.

Because of their low transaction volume, of their low acceptance as exchange medium, and of the lack of clear perception about their legitimacy, the price variation of the so-called virtual currencies may be very large and fast, and may even lead to complete loss of their value.

On top of that, the eventual application, by monetary authorities of any country, of precautionary, coercive or punitive measures relative to the use of those assets, may significantly affect the price of said currencies, or even the possibility of their negotiation.

Furthermore, those virtual intruments may be used for illicit activities, which may lead to investigations by public authorities. That way, the user of those virtual assets, even if he trades them in good faith, may find himself involved in said investigations.

Finally, the storage of the so-called virtual currencies in the so-called electronic wallets suffers from the risk that the owner of those assets suffers patriminial losses as a consequence of criminal attacks in the realm of the worldwide computer network.

In Brazil, even though the use of the so-called virtual currencies has yet to become a risk to the National Financial System, especially to retail payment transactions (article 6, paragraph 4 of Law 12.685/2013), the Central Bank of Brazil is following the evolution of the use of said instruments and the discussions in international forums on the topic -- especially about their nature, adequacy, and mechanism -- with the aim of eventually adopting measures within the scope of its legal mandate, if necessary.

On March 6, the Austrian Financial Market Authority (FMA) broke that nation’s public silence on Bitcoin and gave notice that the agency neither regulates nor supervises Bitcoin activities. The statement also includes a comment that Bitcoin businesses may need to be licensed by other regulatory bodies, outside of the FMA jurisdiction. These two pieces of information are delivered in the first two sentences, and the bulk of the announcement contains a warning about the risks of using Bitcoin and a link to the European Banking Authority warning issued in December 2013.

Just wanted to post a relevant legal news on the thread. There is a scammer named Deepak Chawla who is scamming many people here in India. Some people of the forum have approached me to take some legal action against this person and we are in the process of registering an FIR (First information report) with the police authorities. If the FIR is not registered then we would approach the courts to register the FIR. As per my knowledge this is gonna be the first case ever to come up before judicial authorities (in India) regarding bitcoins.